A $2,000,000 bond is issued on January 1, 20xx with a 9% stated interest rated. Interest is paid semiannually onJune 30 and December 31st. The bond will mature in 10 years. In order to retire the bond at the end of 10years, what amount will be debited to the bonds payable account?Fill in the blank with your calculated number. DO NOT include commas, $ signs, period, decimal points, etc., justenter the raw number. Webcourses will add commas to your answer automatically. For example, if youcalculated the answer to be $24,123, you would only input: 24123ASUSf3f5f6f7f9f10f11f12%24479.T.YFGH.KBNM/085

Bond Value=$2000,000 Interest Rate= 9% paid semiannually Maturity period= 10 years Amount in Bond…

A $2,000,000 bond is issued on January 1, 20xx with a 9% stated interest rated. Interest is paid semiannually on June 30 and December 31st. The bond will mature in 10 years. In order to retire the bond at the end of 10 years, what amount will be debited to the bonds payable account?

A $2,000,000 bond is issued on January 1, 20xx with a 9% stated interest rated. Interest is paid semiannually on June 30 and December 31st. The bond will mature in 10 years. In order to retire the bond at the end of 10 years, what amount will be debited to the bonds payable account?

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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On January 1, Innovative Solutions, Inc., issued $200,000 in bonds at face value. The bonds havea stated interest rate of 6 percent. The bonds mature in 10 years and pay interest once per year onDecember 31.Required:1. Prepare the journal entry to record the bond issuance.2. Prepare the journal entry to record the first interest payment on December 31. Assume nointerest has been accrued earlier in the year.3. Assume the bonds were retired immediately after the first interest payment at a quoted priceof 101. Prepare the journal entry to record the early retirement of the bonds.
Stanford issues bonds dated January 1, 2021, with a par value of $247,000. The bonds' annual contract rate is 6%, and interest is paid semiannually on June 30 and December 31. The bonds mature in three years. The annual market rate at the date of issuance is 8%, and the bonds are sold for $234,048. 1. What is the amount of the discount on these bonds at issuance? 2. How much total bond interest expense will be recognized over the life of these bonds? 3. Prepare an effective interest amortization table for these bonds. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare an effective interest amortization table for these bonds. Note: Round all amounts to the nearest whole dollar. Semiannual Interest Period-End 01/01/2021 06/30/2021 12/31/2021 06/30/2022 12/31/2022 06/30/2023 12/31/2023 Total Cash Interest Bond Interest Paid Expense Discount Amortization < Required 2 Unamortized Discount Carrying Value Required 3
On January 1, Topeka Outfitters issued $175,000 of 6%, 3-year bonds when the market rate of interest was 10%. The bonds pay interest semiannually on June 30 and December 31. How much are the proceeds that Topeka Outfitters? will receive on the issue date of the bonds?
Determine the bond issue proceeds for each of the following bonds payable. All bonds are issued on January 1, 2023. a. Brandy Corporation issued bonds in the amount of $1,290,000 that will be paid in 3 years. Interest of $38,700 is payable semiannually each June 30 and December 31 with the first interest payment at the end of the first period on June 30, 2023. If the market rate of interest is 10%, what is the amount of the bond issue proceeds? (Use the present value and future value tables, a financial calculator, or a spreadsheet for your calculations. If using present and future value tables or the formula method, use factor amounts rounded to five decimal places, X.XXXXX. Round your final answer to the nearest cent, $X.XX.) B. Tandy Corporation issued bonds in the amount of $4,400,000 that will be paid in nine years. Interest of $132,000 is payable semiannually each June 30 and December 31 with the first interest payment at the end of the first period on June 30,…
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Legacy issues $620,000 of 9.5%, four-year bonds dated January 1, 2021, that pay interest semiannually on June 30 and December 31. They are issued at $571,867 when the market rate is 12%. 3. Prepare a straight-line amortization table for the bonds' first two years. Note: Round your intermediate and final answers to the nearest whole dollar.
On May 1, 2023, ACT Company issued a 4-year, P3,000,000 face value bonds with a stated rate of 10%. The effective interest rate for similar bonds is 12%. Interest on the bonds is payable semi-annually on October 30 and April 30. ACT Company uses the calendar year as its reporting period. What is the carrying amount of the bonds on December 31, 2023? A What is the interest expense for the year 2024?B. What is the Discount on Bonds Payable to be reported in the Statement of Financial Position on December 31, 2025?
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The bonds mature on December 31, 2033 (10 years). For bonds of similar risk and maturity, the market yield is 12%. Interest is paid semiannually on June 30 and December 31. Required: 1. Determine the price of the bonds at January 1, 2024. 2. to 4. Prepare the journal entries to record their issuance by The Bradford Company on January 1, 2024, interest on June 30, 2024 (at the effective rate) and interest on December 31, 2024 (at the effective rate). Note: Use tables, Excel, or a financial calculator. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) Complete this question by entering your answers in the tabs below. Req 1 Req 2 to 4 Determine the price of the bonds at January 1, 2024. Note: Enter your answer in whole dollars. Price of bonds
On January 1, Boston Enterprises issues bonds that have a $1,500,000 par value, mature in 20 years, and pay 6% interest semiannually on June 30 and December 31. The bonds are sold at par. 1. How much interest will the issuer pay (in cash) to the bondholders every six months? 2. Prepare journal entries to record (a) the issuance of bonds on January 1, (b) the first interest payment on June 30, and (c) the second interest payment on December 31. 3. Prepare the journal entry for issuance assuming the bonds are issued at (a) 96 and (b) 104. Complete this question by entering your answers in the tabs below. Required 1 Required 2 How much interest will the issuer pay (in cash) to the bondholders every six months? Semiannual Rate Par (maturity) Value Required 3 X Semiannual Cash Interest Payment
On January 1, Boston Enterprises issues bonds that have a $1,900,000 par value, mature in 20 years, and pay 6% interest semiannually on June 30 and December 31. The bonds are sold at par. 1. How much interest will Boston pay (in cash) to the bondholders every six months?2. Prepare journal entries to record (a) the issuance of bonds on January 1, (b) the first interest payment on June 30, and (c) the second interest payment on December 31.3. Prepare the journal entry for issuance assuming the bonds are issued at (a) 98 and (b) 102.
Stanford issues bonds dated January 1, 2019, with a par value of $500,000. The bonds’ annual contract rate is 9%, and interest is paid semiannually on June 30 and December 31. The bonds mature in three years. The annual market rate at the date of issuance is 12%, and the bonds are sold for $463,140. 1. What is the amount of the discount on these bonds at issuance? 2. How much total bond interest expense will be recognized over the life of these bonds? 3. Prepare an effective interest amortization

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